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Cavuto on Business

News/Business. Neil Cavuto and market analysts discuss financial issues and forecasts. New. (CC)

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DURATION
00:30:00

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Annapolis, MD, USA

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Comcast Cable

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Port 1236

VIDEO CODEC
mpeg2video

AUDIO CODEC
mp2

PIXEL WIDTH
720

PIXEL HEIGHT
480

TOPIC FREQUENCY

Charlie 12, Adam 7, Us 6, Ben 5, America 4, U.s. 3, Dagen 3, Gm 3, Ben Stein 2, Sam 2, Motorola 2, Herbert Hoover 2, Jamie Colby 2, Afghanistan 1, Charl Gasperino 1, Rook 1, Sr. 1, Probiotic 1, Pentagon 1, Medicaid 1,
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  FOX News    Cavuto on Business    News/Business. Neil Cavuto and market analysts  
   discuss financial issues and forecasts. New. (CC)  

    July 9, 2011
    10:30 - 11:00am EDT  

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bear? >> bear. >> brenda: your prediction. >> sprint is going to mop up because verizon stopped giving away free unlimited data manes. >> brenda: all right. >> not free, but-- >> cavuto on business next. >> and at tomorrow's debt meeting are taxpayers about to get slammed? forget 2011, try 1990. i'm charles payne in for neil cavuto. if republicans calf, to get spending cuts tomorrow. better remember what happened after a similar budget deal under this president. and george bush, sr. struck a deal to cut $2 in spending for over dollar tax hikes. to dagen mcdowell, ben stein, charl gasperino, adam lashinsky. dagen, what do you make of it. >> spending didn't get cut it went up and taxes, what happened, you saw the industry, be president bush did not get reelected and now
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the republican are promising no tax hikes and heard it over and over again. they better stick to it not just if they want to get reelected in this environment. but rook at 9.2% unemployment rate and the economy can barely create jobs and this is a country that can't handle that kind of spending going up and taxes falling. >> not only that though, charlie, even when they talk spending cuts, they're not talking spending cuts, they're talking not spending as much. >> a slowdown in the growth. >> isn't it disingenuous to begin with? >> no, i think it's a useful debate that we're having right now about the size of government that's slowing down the growth of these certain entitlements, medicare, medicaid. i think it's a complete cop-out to start with raising taxes, i'm not against raising taxes per se, but do it last, that's the last thing do you, not the first thing, because what got us in the hole is the fact that government's too big and here, the american people, this is the welfare, this is the reckoning of the welfare state.
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it's going to stare you in the face. do you want to the government to borrow to pay back borrowing. do you want that or want something different. i think this is a great debate to be having. >> it's a great debate, ben, but feels to me like we might be entering some sort of deal that looks good on the surface, but as we get into it doesn't resolve anything. >> i'm a little puzzled about what my friend and pal and colleague dagen said about how it country can't afford higher taxes. we had much, much higher taxes in the entire period from 1941 until 2001 and did fine for most of the time so i'm kind of puzzled about that. >> you would raise taxes-- >> we have to have a deal to not interrupt each other. we can have much higher taxes and especially on very wealthy people and i don't want to raise taxes on dagen and i don't want to raise taxes on charles, but on people who are making a million dollar, a couple million a year and raise their taxes and-- >> and it will still say-- >> it will still make a great
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deal more money than if we didn't raise taxes at all. >> but you would raise them with the economy the way it is. >> my turn, please. >> hold on one second. >> absolutely. >> i absolutely would. absolutely, absolutely. this country has plenty of capital. we're not short of capital. we're sort of a willingness to invest the capital and that has a lot to do-- >> because they don't want taxes-- >> other than the tax rate. >> and here is the thing though, adam, to ben's point, yeah, people have money, banks have money, but corporations have money. our government does not have money and this is more of a spending issue from the perspective of many americans, not an issue about revenue. >> well, in fact, our government does have money. i think that's why, that's why ben was chuckling. i think by the way, charles, you know, the rhetoric is important here, ben asked not to be interrupted which was kind of amusing, but you started off by asking charlie, they want to cut, they want to raise taxes. the i think by they, you meant the democrats so i'm not sure
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who we are. but i make this point for a reason, which is that, you know, if bush one got this two for one deal wrong we need a one for one deal here. we do need to raise taxes. we do need to cut spending and anybody who says-- >> hold on, i'm almost finished. anyone who says we need one more than the other, they're being partisan or ideological. and people understand we need to do both. >> first off with all due respect that money is my money not the government's morning. >> there's no such-- >> doan be so cavalier with the money that american people earned and put away. i'm the not against raising taxes. the problem is that anytime you raise taxes, it's a huge cop-out because the problem here is not at that we don't tax enough, the problem here is that we spend too much, and we're spending money, and we're borrowing money to pay back, and start with the problem, the-- >> you're making a generalization, charlie. >> you think that government is small?
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>> hold on a second, guys. because this is what i really want to get back to and dagen, you really got to the point of this whole thing. and even if we do come up with some sort of compromise, realistically it might not be a compromise. we had a deal with the lame duck session and once we went through the numbers, it wasn't really a deal. the president didn't really give anything. so, if there is some sort of compromise, can we even trust that the spending will be there? the taxes will be there. >> historically what happened. the spending goes up and never materialize, what you're looking at this weekend's bargaining session between the republicans and democrats, they will likely put together a frame work of a deal or a deal, but it isn't going to be legislation, they're not going to really vote on it before this august 2nd deadline shows up. get everybody on board, this is what we're going to do and so the republicans will be voting on faith, whatever the two sides come up with. >> by the way when you talk about raising taxes and comparing now to the 1940's, i
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mean, you compare now to like 1929. when herbert hoover raised taxes and sunk the economy and made the great depression even worse. that's the right-- >> with all due respect, charlie, with the greatest possible respect, i don't think you could find one economic historian in the world that would say that his teenie tiny tax rate caused the great depression. >> no, i'm not saying it caused it, it was one of the-- ben, it was destimulating at a time we needed stimulus and it's the same situation now. >> i don't think anyone would say that. >> i've heard, i've heard many mainstream economists talk about herbert hoover-- >> i'm sorry i didn't just make that up. >> ben, what about the notion that charlie brings up a lot. we tried to tact, we tried spending cuts first and if that doesn't work, then we implement your idea of adding tax increases to that? >> i think we don't have any time to spare. i think we've got to do both right away. i must say, i'm extremely impressed with adam's intelligence on this one. there's a--
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and on everything of course, but one-to-one, why don't we have one-to-one spending cuts, spending cuts and taxes are too low, especially on-- people just a joke how low taxes are on high income people. >> ben, i can answer that, because there aren't enough people to tax. you think you can solve this by-- everybody makes over 2 million dollars a year? >> i think you solve a lot of it. >> 30 seconds, let adam finish up. go ahead, adam. i think to ben's assertion is that you and charlie and dagen don't believe that if we cut spending and raise taxes on one for one basis. >> look at the history. >> that the spending cuts will really happen. i get that point from you. we, as a government, as a people, as a country, need to work to make it happen. just because it hasn't-- >> and doesn't mean we can't do it. >> when is the last time it happened? >> remember, we're talking about borrowing money to pay money that we borrowed before. that's where people are worried right now. and our government is also--
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it's also our future. >> it's everybody's fault that those spending cuts never materialize, there's a bailout and a-- it never happens. >> it's so much easier to cut taxes on the filthy rich than the-- >> let's leave it there, guys. don't remember writing a check to the president's reelection campaign? and some say thanks to these guys, you just did. that's at the top of the hour. first we bail them out and now they're handing out free car insurance. is gm setting up taxpayers to rescue them from yet another financial wreck? i know you're worried about making your savis last and having enough income when you retire. that's why i'm here --
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to help come up with a plan and get you on the right path. i have more than a thousand fidelity experts working with me so that i can work one-on-one with you. it's your green line. but i'll be there every step of the way. call or come in and talk with us today.
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>> good morning everyone, live from america's news headquarters, i'm jamie colby. we're expecting a major weekend he showdown in the debt debate. top leaders of both parties preparing to go toe to toe tomorrow at the white house. president obama wants them to
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begin some hard bargaining. if the plan to raise the debt ceiling isn't reached, the u.s. could default on its loans by august 2nd. u.s. defense secretary leon panetta arriving in afghanistan today for the first visit since taking over at the pentagon. panetta who stepped down as cia director plans to discuss the u.s. troop withdrawal with president karzai. and a fire breaking out at a rihanna concert in dallas forcing the event to end early. witnesses saying the lights went up in flames to the curtain and everyone inside was evacuated and fortunately, no one was hurt. i'm jamie colby, keep it here on the fox news channel. now back to cavuto on fox business. >> well, we gave them a 50 billion dollar rescue and now general motors is giving car buyers in the northwest free auto insurance for a whole year and they say it will rev up sales in a slow market and we know that nothing comes for
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free. >> we own a quarter of this puppy, so anything for sales, at least general motors is trying to get creative and the auto companies always offer perks, incentives, 0% financing, and targeting a few states where sales aren't great, but watch their, gm's inventories and trucks, they're going right back in the direction they used to. >> i mean, all of it seems to be going in the direction it was in, charlie, and you think they'd be responsible, but isn't this the slippery slope of bailouts. they can do anything they want just like wall street banks and they know a check is waiting for them. >> it's the ultimate moral hazard, there's no consequence to your risk and i think that's the problem with banks and now, the problem is that there's always controversy. banks like goldman sachs, it's going to be seen through the prism of hey, you bailed out in 2008 and now you're paying people all this money and that's the problem with bailing out in the first place, seen through the prism this is government motors or
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government saks. >> adam, want to say something? >> want to say that i'm shocked, completely shocked that we would second guess this business. i mean, charles, that strikes me as socialism. you seem to be saying that since we own them, we should not let them do this free auto insurance plan because we think that it's not a good business idea. let them run their business and by the way, there was a moral hazard, charlie, you know that. the equity holders of general motors were wiped out. if they screw this up they'll be wiped out again this time 25% of it will be us. >> a lot of management, the bondholders weren't screwed over and i tell you. >> they were. >> moral hazard. >> the employees weren't-- >> the employees kept their job and-- >> i don't care letting general motors do what they want as long as i'm not on the hook if they fail and i think that's the discussion here. >> well, you know, us taxpayers are all on the hook for an awful lot of things and this is a sales promotion, none of us would be discussing this if general motors said we'll give you $500 off on your next chevy or cadillac
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and the subject wouldn't come up. it's a kind of a novel, rather clever idea for selling a car, maybe first time buyers in there and worried about-- >> and it's actually genius, 'cause it's-- >> and exactly genius 'cause somehow it encourages people to think of free insurance i'm going to go out and wreck this baby and then have to replace it in three months. >> i think we would be walk talking about this if gm cut the price and giving people cash rebates because it's a government-run company and that's the problem when you have the government running-- >> it's not a government run-- >> okay, it's a government partially owned company, i'm sorry, they have to go to washington and kiss rear. >> hold on, we want them to be successful, ben, but isn't there something worrisome when the average car is ten years old and they still have to do these gimmicks in the first place? >> well, it's a very worrisome economy, but i think it's a rather clever and thoughtful promotion, i don't see a thing wrong with it any more than if they gave people a refrigerator if they bought a
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car or if they cut $500 off the sticker. it seems like a rather clever idea and i'm not sure why it's a problem for us, although, i'm delighted to hear why somebody else does. >> adam, real quick, if this fails, let's say general motors doesn't live up to the hype and they're in trouble. should the american taxpayers be on the hook one more time? >> the short answer, no, it's a smaller company now, let's hope they're not too big to fail if something bad were to happen again. by the way, i'm glad they are he giving attention and helping our investment giving them free advertising. >> dagen, does that mean you'll buy some stock. >> no, i'll buy pompons, with short skirt and gm on it-- >> you do that and help sale some cars. >> and uncle sam taking out toucan sam? fighting back. [ male announcer ] introducing the ultimate business phone --
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>> coming up. junk ng-- junking ads for junk food. no sugar coating here, the
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. [crying] >> bring on the nanny state alert. a company is trying to change the marketing of so-called junk foods and how they're rushing to the industry's defense. ben stein, what do you think of this, another attack by the food police? >> i really have to laugh at this. i worked on this kind of exact, this exactly kind of case at the federal trade commission in 1971-72.
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we were concerned then that america was going to die of junk food and america didn't die of junk food and i don't see why tony the tiger doesn't have the same rights to free speech as alexander hamilton had. it's incredibly important thing to allow businesses to advertise their products. people aren't going to tie, i don't know what the product is i guess frosted flakes, aim not sure, anyway, they happen to be delicious, why shouldn't they say the products are tasty and delicious. >> and i think getting fat off shredded wheats the way i eat it bowl of sugar and half and half rather than milk, but that's my choice and my mistake and where regulators lose their way, personal responsibility. >> and some of this, this labeling is-- eat this-- >> and the problem. >> this is the not about labeling. >>, but hold on one second, charlie, are you telling me that people that eat this stuff don't think-- think it's healthy? they don't understand the ramifications of it. >> do you think that people who smoke don't know that--
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and we've got all sorts of labeling. >> wait a minute, wait a minute, you equated frosted flakes with cigarettes? >> no, i didn't. calm down, i did not do that. i'm just saying that some things are complete garbage and no problem with labeling it as such. if you want to eat garbage, eat garbage. >> and the government intrusion is the big garbage thing right now and the intrusiveness of it has gone too far. adam, how do you feel about it? >> i feel that, for example, what we did with cigarettes contributed to a major decrease in smoking in the united states, and a decrease in lung cancer, we have a big obesity problem in this countries because of processed garbage food like this, and i see no problem whatsoever with the government telling people that. >> by the way, am i missing something? are they outlawing this junk? >> these are voluntary guidelines. >> labels, and people-- >> keep calling it junk? why do you keep calling it junk? >> we all know-- >> and it isn't junk.
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>> this stuff is garbage. >> it isn't junk. >> that's my point, no one-- >> it's horrible, it's-- >> it isn't horrible, it's great and lots of nutrients. >> and the label, charlie, it's not garbage. look at the label, it's not garbage, there's lots of vitamins and minerals and not-- >> not the mediterranean diet. >> here is the thing, charlie, why does everyone have to be on the mediterranean diet? you're a tremendous fitness buff and why should i live my-- >> i don't have a problem with full disclosure. say it. >> you know what is c-r-a-p the fact that the government doesn't think, the government doesn't think that people can't make decisions on their own and that they're so stupid that these companies are marketing to them and that's why the nation's obesity rate is mushrooming. and if you want to eat it-- >> let's get adam in on this point. adam i think the main point that dagen hit on.
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where does the government stop with respect to telling us what we can and cannot done and how stupid we are as consumers to buy frosted flakes? >> if the government makes the determination where they think something is extremely dangerous, like meth amphetamines, for example, they say you can't use that it's against the law. with other things that research shows that too much of something is not good for you, the government informs us of that and requires people who make it to tell you. >> absolute mind, your a comparing sugary cereals to cigarettes and meth! >> i can't believe what i'm hearing. >> we have socialized medicine. >> i can't believe what i'm hearing, this is insanity. >> you don't want the government to force the poem who make the products-- >> ben. >> people should be allowed to choose-- this country has been eating sugary cereals for a long time. we're a prosperous country. do you think it's in a class with cigarettes and methamphetamines?
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>> i didn't say that. >> it's absurd. >> and we are going to leave it there. >> and ben, by the way, he was mean to me at the top of the show, but i love him. >> rekindled the love affair. thanks to charlie and dagen. and up next besides the sugar, forget about going to the ball game. it's time to play ball with our all-star stock pickers. the names on their money making team in our own mid summer classic next. ♪ enough whole grain. but actually, it's never been easier to get the whole grain you want from your favorite big g cereals. from cheerios to lucky charms, there's whole grain in every box. make sure to look for the white check.
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>> all-stars stocks from our all-star stock team. ben? >> we don't have secret inside information i will go with the index. >> adam, what do you think of that? >> i think we need you in this segment, charles. we like the whole concept of the buying the market. this is something you should do for a big chunk of your investment. you need cash and bonds.
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>> and he is (talking all at once.) ing about the s&p 500. >> what is your pick. >> you need frosted flakes. >> it is similar vanguard health. this is a large cap stock fund and skewed toward health care companies. one thing we can be assured of. what ever happens with the industrial economy we'll need health care and medicine and so on. >> first topic . debt ceiling vote. you think there will be a compromise? >> yes, or no. and yes, i am scared yes, i think so. and it is a compromise and it will include taxs and spending cuts. >> there will be a compromise and yes, i think we will have new taxes and pending cuts. >> if you guys are right. what is the market going to do, adam in >>